I lost 1% today. My trades were all pretty much duds. I took damage from my TLT and GDX shorts. I got out of my GLD short at a small profit. I am still long BA. But on the whole, I felt rather “out of synch“‘ today. Given how fantastic the past month has been, meh, I can live with it. I just forgot was it was like to end the day in the red.
Still, I’m not sure how much “synch” there exists that one can be “in” with at all. This market is unrepentant chop. One glance at the ES shows that all we’ve doing is banging around in a slightly lower range.
Indeed, I can’t remember how long it’s been since I’ve been so uninterested in having positions. Early in February, I felt like the world was my oyster. Virtually every chart was shortable, and virtually every social signal (“Stonks Only Go Up!!”) just reeked of bullish hubris. That is precisely why I could be 242% short and sleep at night.
Right now, though, I am literally 99.9% in cash. I have a laughably small long position in BA, just for the hell of it. My scalping today was a total dud. I know stocks seem “cheap“, but I’m here to tell you, this is not a “base“. A base is something hammered out over a long period and provides a strong foundation. This……………this is just a small zone to which stocks have been mercilessly battered and bludgeoned.
It’s not that I don’t think it’s a bottom. My post yesterday afternoon, The Bottom Is In, said it explicitly. But this market is fraught with risk, even though we’ve already bled off about a quarter of the insanely high VIX level.
People may see opportunity and yet wind up with their hands chopped off. Just this morning, I sent to Slope’s Gold/Diamond members a post called Meal Kits, which talked about how Blue Apron had surged 1200% this week (!!!!!!!!) based, I suppose, on the notion that we’d all be ordering meal kits instead of eating out.
In the post I wrote:
Let’s just say I don’t think it’s going to last. People don’t want to eat freakin’ meal kits. There’s a reason the stock got battered down to $2 in the first place. Something to keep in mind in the days ahead.
I’ve marked with an arrow the spot where I sent out the post. The price didn’t take “days” to unravel. It took only moments. Don’t you think those who were buying where I’ve placed the arrow believed they were getting in at a good price?
I hate to say it, but it could be weeks, if not months, before I’m truly comfortable getting serious about trading again. As for shorting, it will almost certainly be months, which is freakish for me.
But the cold fact of the matter is that this indeed a kind of Grand Reset. The problem right now is that one doesn’t take a market in which literally trillions and trillions of dollars have simply vanished and just sort of wade in and trade it normally. This is a patient in the throes of cardiac arrest, and I daresay tomorrow’s quadruple witching hour isn’t exactly going to give us a VIX at 11 like we had not that long ago.